BabyMuskCoin Honeypot Rugpull

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BabyMuskCoin

Baby Musk Coin was a new meme coin launched to supposedly attract the attention of Elon Musk. The smart contract was structured to prevent the token from being sold other than by founders. The token was able to trend on CoinMarketCap and then even gained some news coverage before the founders decided to sell all tokens into the market, capturing the entire liquidity. The resulting BNB was then anonymized through TornadoCash.

This is a global/international case not involving a specific country. [1][2][3][4][5][6][7][8][9]

About BabyMuskCoin

[10][11][12][13][14]

"Ever since the popularity explosion of Dogecoin, propelled mainly by one of the most influential individuals – Elon Musk, the cryptocurrency industry has seen a rapidly growing number of memecoins." "As the popularity of Dogecoin rose after Tesla's CEO Elon Musk started propping it up on social media, there have been multiple projects that tried to replicate the success of DOGE by creating similar memecoins, or ones that relate with Musk."

"The Biggest Dreamer Is Now Even More Little. BABY MUSK Coin is an open source Bep-20 token."

"BabyMusk is a tribute coin to Elon Musk. Its community has one main goal: to catch Elon's attention such that he will join the project. He is Hyper-deflationary with an integrated smart staking system built in to reward you in BTC that are being automatically added to your wallet each transaction. Simply hold BabyMusk in your wallet and watch your BTC grow."

"A decentralized token with innovative technologies backing its potential, Musk is bound to be the next big thing in the world of cryptocurrencies." "Musk prides itself on morals of giving more than taking! After all, we’re always one step ahead when it comes to helping the community." "We have a designated charity wallet that receives redistributions that are used to support our charity partners."

"The Development of our Web Application & IOS/Android Mobile application that will feature a decentralized all-in-one wallet to store all your digital assets into one place, live charts, historical data, price drop notifications, staking, daily news, and lots more. Our mission is to create an irreplaceable position in the crypto space as an emerging coin with limitless financial rewards and benefits, all the while doing our part for the community." "BABYMUSK is built to reward trusted holders." "For each transaction, holders get a % reward in BTC and another % goes to the liquidity pool in order to maximise coin stability." "We are burning 50%+ of the supply within one year from launch."

"As a reliable coin with a rock-solid foundation, Musk is based on a proper mechanism to combat dumps. We are secured through the current taxation system and the right measures currently deployed to enable anti-whale function." "Unruggable, majority of LP tokens locked & some burned so there's always LP."

"During its initial coin offering (ICO) in early February 2022, the project raised almost $2 million. The token’s creators went to great lengths to make the initiative appear respectable, claiming that their goal was to “revolutionize the meme industry.” The Baby Musk Coin website, which is now defunct, contained a roadmap outlining the project’s future ambitions." "Initially, the project was seen as quite legitimate with an extensive roadmap, and initial coin offering (ICO) which raised more than $2 million. Even the alleged CEO of BabyMuskCoin Grant Liu stated that the project was merely in its beginning stages."

"Not only Baby coins are a cuter version of the animal coins that used to be very popular back in the years, but they also all have one very peculiar utility: for users they will reward them with more popular coins like BNB, Ethereum, Dogecoin etc. " "When the coin was released, it immediately saw a price increase, and the apparent CEO Grant Liu stated that it was “only the beginning.” Some of the features offered by the project include an index fund and a “Baby Musk Swap.”"

"As InvestorPlace contributor Chris MacDonald wrote yesterday, Baby Musk Coin seemed like the big new meme coin to invest in. It blends right in next to tokens like Shiba Inu (SHIB-USD), Dogelon Mars (ELON-USD) and Baby Lambo Inu (BLINU-USD), taking various aspects of these tokens and adopting them for its own project. It blended in so nicely, in fact, that it posted gains of over 30% yesterday alone."

"There’s a new kid on the meme token block. Today’s reports that Baby Musk Coin (CCC:BABYMUSK-USD) pulled off a successful initial coin offering have been met with enthusiasm. Currently, the BABYMUSK crypto is up more than 30% on an impressive opening day."

The Reality

"Like other meme tokens, investors in Baby Musk Coin appear to be after moonshot-type gains. Just like Shiba Inu (CCC:SHIB-USD) and Floki Inu (CCC:FLOKI-USD), meme spinoffs have become all the rage. Any asset that has the potential to see incredible gains over short periods of time is still enticing to many investors."

"Of course, these investments carry much higher levels of risk. However, for early investors willing to throw a few bucks at a project, such tokens are often viewed as call options on insanity."

"In what is known as a honeypot, holders of the coin are unable to sell the token."

CryptoPotato reports that BabyMuskCoin, a memecoin in the cryptocurrency space, recently rug pulled and scammed investors out of over $600,000. Rug pulls, where the founders abandon the project and dump all coins, have become a concerning trend in the industry. CertiK, a blockchain security company, provided insights on how users can protect themselves from such scams. BabyMuskCoin, named after Elon Musk, saw its native token's price plummet by 99% in a short period as the anonymous team behind the project moved funds to Tornado Cash. The team initially claimed to be scammed but subsequently disappeared from Telegram, Twitter, and their website. CertiK observed that the team made transactions to Tornado Cash and later swapped BabyMUSK tokens for BNB, driving the price to zero. To avoid rug pulls, investors should be cautious of relentless token promotions and focus on community growth and fundamentals. Thoroughly reading audit reports and understanding secure coding best practices can also help mitigate risks[15].

BeInCrypto reports that Baby Musk Coin, a meme coin named after Elon Musk, experienced a rug pull, causing its price to plummet by nearly 100%. The developers of the project dumped the tokens, leaving holders unable to sell them in what is known as a honeypot. The coin had raised over $2 million during its ICO and promised to revolutionize the meme industry. Scams, including NFT scams, continue to be prevalent in the crypto market, with scammers taking advantage of popular culture to deceive victims. Education, awareness, and forthcoming regulations are seen as crucial in combating scams and protecting investors. The UN has also reported that North Korea is funding its missile program using stolen crypto, highlighting the need for enhanced security measures[16].


What Happened

From 4 February to 9 February, this coin kept climbing up the ladder on its price chart. However, during the last few hours of 9th, Baby Musk Coin witnessed a free fall, shedding almost 100% of its value. Since then, it has been trading around the newly created lows only."

"The native token’s price dumped by 99% in hours as the anonymous team behind the project moved off 1,571 BNB (worth around $660,000 at the time)." "BabyMuskCoin plummeted 99%, 1,571 BNB (~$660,000) was dumped, and funds were moved to Tornado."

"In what is known as a honeypot, holders of the coin are unable to sell the token."

Key Event Timeline - BabyMuskCoin Honeypot Rugpull
Date Event Description
February 5th, 2022 3:31:00 AM MST Warning From Twitter A Twitter user warns about the project being a honeypot and notes that it's trending as #2 on CoinMarketCap[17].
February 9th, 2022 11:43:00 AM MST CertiK Community Alert CertiK publishes a community alert about the Baby Musk Coin as a completed rug pull[18].
February 11th, 2022 1:25:06 AM MST BeInCrypto Article Published BeInCrypto reports that Baby Musk Coin, a meme coin named after Elon Musk, experienced a rug pull, causing its price to plummet by nearly 100%. The developers of the project dumped the tokens, leaving holders unable to sell them in what is known as a honeypot. The coin had raised over $2 million during its ICO and promised to revolutionize the meme industry. Scams, including NFT scams, continue to be prevalent in the crypto market, with scammers taking advantage of popular culture to deceive victims. Education, awareness, and forthcoming regulations are seen as crucial in combating scams and protecting investors. The UN has also reported that North Korea is funding its missile program using stolen crypto, highlighting the need for enhanced security measures[16].
February 11th, 2022 5:26:56 AM MST CryptoPotato Article Published CryptoPotato reports that BabyMuskCoin, a memecoin in the cryptocurrency space, recently rug pulled and scammed investors out of over $600,000. Rug pulls, where the founders abandon the project and dump all coins, have become a concerning trend in the industry. CertiK, a blockchain security company, provided insights on how users can protect themselves from such scams. BabyMuskCoin, named after Elon Musk, saw its native token's price plummet by 99% in a short period as the anonymous team behind the project moved funds to Tornado Cash. The team initially claimed to be scammed but subsequently disappeared from Telegram, Twitter, and their website. CertiK observed that the team made transactions to Tornado Cash and later swapped BabyMUSK tokens for BNB, driving the price to zero. To avoid rug pulls, investors should be cautious of relentless token promotions and focus on community growth and fundamentals. Thoroughly reading audit reports and understanding secure coding best practices can also help mitigate risks[15].

Technical Details

"From 4 February to 9 February, this coin kept climbing up the ladder on its price chart. However, during the last few hours of 9th, Baby Musk Coin witnessed a free fall, shedding almost 100% of its value. Since then, it has been trading around the newly created lows only."

"The native token’s price dumped by 99% in hours as the anonymous team behind the project moved off 1,571 BNB (worth around $660,000 at the time)." "BabyMuskCoin plummeted 99%, 1,571 BNB (~$660,000) was dumped, and funds were moved to Tornado."

"In what is known as a honeypot, holders of the coin are unable to sell the token."

"According to the post [by CertiK], 1,571 BNB were extracted from the project, presumably by the creators of the project, and moved to Tornado cash, which is a protocol that increases the privacy of transactions via "breaking the on-chain link between source and destination addresses.""

"The project #BabyMuskCoin has dropped 99% and appears to be a #rugpull. 1,571 $BNB (~$66[0]K) was dumped and the funds were moved to Tornado cash."

"Right after that, the price of BabyMuskCoin plummeted by almost 100%, with users stuck in the honeypot, or, in other words, unable to sell their stash of tokens. Likewise, as with all rug pulls, the team behind the project deleted all of its pages on social media."

[11][14]

Total Amount Lost

The total amount lost has been estimated at $664,000 USD.[14][19]

"The native token’s price dumped by 99% in hours as the anonymous team behind the project moved off 1,571 BNB (worth around $660,000 at the time)." "BabyMuskCoin plummeted 99%, 1,571 BNB (~$660,000) was dumped, and funds were moved to Tornado."

How much was lost and how was it calculated? If there are conflicting reports, which are accurate and where does the discrepancy lie?

"According to the post [by CertiK], 1,571 BNB were extracted from the project, presumably by the creators of the project, and moved to Tornado cash, which is a protocol that increases the privacy of transactions via "breaking the on-chain link between source and destination addresses.""

"The project #BabyMuskCoin has dropped 99% and appears to be a #rugpull. 1,571 $BNB (~$66[0]K) was dumped and the funds were moved to Tornado cash."

"Right after that, the price of BabyMuskCoin plummeted by almost 100%, with users stuck in the honeypot, or, in other words, unable to sell their stash of tokens. Likewise, as with all rug pulls, the team behind the project deleted all of its pages on social media."

Immediate Reactions

How did the various parties involved (firm, platform, management, and/or affected individual(s)) deal with the events? Were services shut down? Were announcements made? Were groups formed?

"The first warnings came just days after the ICO by Twitter user named @NOSHITCoin_io. The user noted several red flags, including the giant BABYMUSK holding by developers and the fact that users can’t sell. As such, the user labeled it a honeypot scheme. They also took CoinMarketCap to task over its listing of BABYMUSK data — something the project noted in its press release to “prove” legitimacy."

"BEWARE ‼️ A #SCAM project @BabyMuskCoin is currently #trending top 2 @ #CMC! It is a #honeypot, you can't sell‼️ How can you trend #scams & trick people @CoinMarketCap?"[17]

"And now, the project is falling apart. The project’s developers appear to have scrubbed all signs of BABYMUSK’s existence; the project’s website and Twitter account are gone, as is the self-proclaimed “viral Baby Musk Dance video” it posted to promote the project." "The project team CLAIMS to have been scammed via Telegram, but the Twitter and website are down."

[20]

CertiK Community Alert

CertiK shared a community alert on Twitter[18].

The project #BabyMuskCoin has dropped 99% and appears to be a #rugpull

1,571 $BNB (~$66K) was dumped and the funds were moved to Tornado cash.

The project team CLAIMS to have been scammed via Telegram, but the Twitter and website are down

Ultimate Outcome

What was the end result? Was any investigation done? Were any individuals prosecuted? Was there a lawsuit? Was any tracing done?

[21]

"And now, the project is falling apart. The project’s developers appear to have scrubbed all signs of BABYMUSK’s existence; the project’s website and Twitter account are gone, as is the self-proclaimed “viral Baby Musk Dance video” it posted to promote the project." "The project team CLAIMS to have been scammed via Telegram, but the Twitter and website are down."

Total Amount Recovered

There do not appear to have been any funds recovered in this case.

Ongoing Developments

TBD

Individual Prevention Policies

The Baby Musk Coin was unable to be sold. This detail could have easily been discovered through a smart contract audit.

Avoid the use of smart contracts unless necessary. Minimize the level of exposure by removing or withdrawing assets whenever possible. Aim to choose smart contracts which have obtained third party security audits, preferably having been audited by at least three separate reputable firms. Pay attention to the audit reports, which smart contracts are covered, and whether the smart contract has been upgraded or modified since the report. Ensure that any administrative functions with the ability to remove funds from the smart contract are under the authority of a multi-signature wallet which is controlled by at least three separate and reputable entities.

For the full list of how to protect your funds as an individual, check our Prevention Policies for Individuals guide.

Platform Prevention Policies

This case does not appear to have resulted in a loss to any platform. Platforms could still assist through increased education and/or establishing an industry insurance fund.

Never take for granted the limited knowledge of users of your service and their tendency to skip past provided information. It is recommended to design a simple tutorial and quiz for new users which explains the basics of seed phrases, strong password generation, secure two-factor authentication, common fraud schemes, how ponzi schemes work, as well as other risks which are unique to the cryptocurrency space. This tutorial and quiz should ensure their understanding and be a standard part of the sign-up or download process which is difficult or impossible to skip.

Work with other industry platforms to set up a multi-signature wallet with private keys held separately by delegate signatories from seven prominent platforms and services within the industry. Establish requirements for contributions by all platforms and services, designed to be affordable for small platforms yet large enough to cover anticipated breach events. Any breach event can be brought forth by a member platform or a petition of 100 signatures for consideration by the delegate signatories. A vote of 4 or more delegate signatures is required to release any funds, which could partially or fully restore lost funds based on their assessment.

For the full list of how to protect your funds as a financial service, check our Prevention Policies for Platforms guide.

Regulatory Prevention Policies

Having an effective system for approval of platforms can improve the information which is available to users.

All platforms should undergo published security and risk assessments by independent third parties. Two assessments are required at founding or major upgrade, one after 3 months, and one every 6 months thereafter. The third parties must not repeat within the past 14 months. A risk assessment needs to include what assets back customer deposits and the risk of default from any third parties being lent to. The security assessment must include ensuring a proper multi-signature wallet, and that all signatories are properly trained. Assessments must be performed on social media, databases, and DNS security.

Users require greater education to understand the risks and protect themselves.

Create a standard tutorial and quiz for all new cryptocurrency participants, which is required to be completed once per participant. This tutorial and quiz should cover the basics of proper seed phrase protection, strong password generation, secure two-factor authentication, common fraud schemes, how to detect and guard against phishing attacks, how ponzi schemes work, as well as other risks which are unique to the cryptocurrency space.

An industry insurance fund should be established and made available to assist victims.

Set up a multi-signature wallet with private keys held separately by delegate signatories from seven prominent platforms and services within the industry. Establish requirements for contributions by all platforms and services within the country, designed to be affordable for small platforms yet large enough to cover anticipated breach events. Any breach event can be brought forth by a member platform or a petition of 100 signatures for consideration by the delegate signatories. A vote of 4 or more delegate signatures is required to release any funds, which could partially or fully restore lost funds based on their assessment.

For the full list of regulatory policies that can prevent loss, check our Prevention Policies for Regulators guide.

References

  1. ↑ BabyMuskCoin Rug Pulls $660K in BNB: Experts Advise How to Avoid Getting Scammed - Cryptostudent.io (Mar 12, 2022)
  2. ↑ BabyMuskCoin Rug Pulled of $660K in BNB by Creators (Mar 12, 2022)
  3. ↑ After rug pull, Baby Musk Meme Coin drops 100% - TechStory (Mar 12, 2022)
  4. ↑ Baby Musk Meme Coin Drops 100% After Rug Pull : CryptoCurrency (Mar 12, 2022)
  5. ↑ https://www.nasdaq.com/articles/baby-musk-coin-tanks-nearly-100-as-project-crumbles-in-apparent-rug-pull-scam (Mar 12, 2022)
  6. ↑ The Baby Musk Coin Plummets By Nearly 100% | CoinCodeCap (Mar 12, 2022)
  7. ↑ BABYMUSK Crypto Spikes 33% as Investors Bark for the New Baby Musk Meme Coin | InvestorPlace (Mar 12, 2022)
  8. ↑ Baby Musk Coin rug pull involving 1,571 BNB [$660k] makes investors go bald (Mar 12, 2022)
  9. ↑ Baby Musk Coin Price Drops 100% Following Its Rug Pull Scam - CoinCu News (Mar 12, 2022)
  10. ↑ BABY MUSK Coin is an open source Bep-20 token. (Mar 12, 2022)
  11. ↑ 11.0 11.1 https://bscscan.com/address/0x0b1Ff525E092a98210eD150F8B08313F646847D6 (Mar 12, 2022)
  12. ↑ Wayback Machine (Mar 12, 2022)
  13. ↑ BabyMusk Coin Launches, As It Aims To Be The Next Big MEME (Mar 12, 2022)
  14. ↑ 14.0 14.1 14.2 https://coinmarketcap.com/currencies/baby-musk-coin/ (Mar 12, 2022)
  15. ↑ 15.0 15.1 BabyMuskCoin Rug Pulls $660K in BNB: Experts Advise How to Avoid Getting Scammed - CryptoPotato (Mar 12, 2022)
  16. ↑ 16.0 16.1 Baby Musk Meme Coin Drops 100% After Rug Pull - BeInCrypto (Mar 12, 2022)
  17. ↑ 17.0 17.1 NOSHITCoin_io - "BEWARE A #SCAM project @BabyMuskCoin is currently #trending top 2 @ #CMC! It is a #honeypot, you can't sell How can you trend #scams & trick people @CoinMarketCap?" - Twitter (Mar 12, 2022)
  18. ↑ 18.0 18.1 CertiKCommunity - "The project #BabyMuskCoin has dropped 99% and appears to be a #rugpull 1,571 $BNB (~$66K) was dumped and the funds were moved to Tornado cash. The project team CLAIMS to have been scammed via Telegram, but the Twitter and website are down" - Twitter (Mar 12, 2022)
  19. ↑ https://coinmarketcap.com/currencies/bnb/historical-data/ (Feb 15, 2022)
  20. ↑ anggaandinata - "Babymusk comfirmed rugpulled" - Twitter (Mar 12, 2022)
  21. ↑ SlowMist Hacked - SlowMist Zone (Jun 26, 2021)
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